The Battle of the Debt-ceiling in Washington is coming down to the end-game. Republicans are trying valiantly to honor their pledge from the last election not to raise taxes, and to support an increase in the debt-ceiling only if the action is accompanied by spending reductions in the same amount, over a ten-year period. Democrats are trying just as hard to hold the line on federal spending by declaring all items “essential” – with the possible exception of defense spending. And President Obama is determined that a (really) big deal should be struck which includes “revenue” (i.e., tax) increases, along with promises of spending cuts. As I have written before in this space, the question is which side will blink first.
For his part, Mr. Obama has thrown in the kitchen sink, going around the country declaring that a failure to raise the debt-ceiling – which he famously opposed as a senator in 2006 – will lead to a fiscal “catastrophe.” (“Say, I think I’ve heard that song before…”) He has intimated that the USA would default on its debt-obligations and be unable to send Social Security recipients their monthly checks. He has also made dark suggestions about denying critically ill patients the medical care they need. The scare-mongering has reached levels rarely seen before – even in a city which thrives on such hyperbole.
In the course of all this catastrophe-hype, there have been very few media questions about the validity of those claims. Most notably, I have seen not one report identifying the president’s claim about not sending Social Security checks as a complete fabrication. I don’t say this lightly, but I am certain that the threat is empty – or should be, if the law is followed.
The fact is that Social Security is an entirely separate financial system. Its books are separate from the federal government’s books. Right now, Social Security’s books are in the “black” – meaning that FICA taxes received for the year exceed outlays. Those “payroll taxes,” as they are often called, are used directly to fund the benefits paid every month to pensioners and other Social Security beneficiaries.
Any FICA surpluses go into the Old-Age and Survivors and Disability Insurance (OASDI) Trust Fund – commonly known as the Social Security Trust Fund. The latter, of course, is now a “virtual reality,” since those surpluses are immediately borrowed by the federal government to fund its operating deficits. At present, the OASDI Trust Fund contains $2.4 trillion worth of special securities issued by the federal treasury. When the Social Security System reaches a point where payroll taxes can no longer cover its benefit payments, the federal treasury will have to honor those securities, as demanded. Until that time – estimated by some experts to be around 2017 – Social Security will be able to pay its obligations without reference to whatever is going on with the federal government’s debt-ceiling, debts, deficits, or budget.
This means that Mr. Obama’s ominous yarn about seniors not getting their pension-checks unless the debt-ceiling is raised is purest horse-hockey (to use a term acceptable in a family newspaper). It’s always possible that he doesn’t realize all this about the separate books, of course, but a president who’s not aware of this really should not be sitting in the Oval Office. The more likely situation is that Mr. Obama does know the truth, but has chosen to mislead fearful old people (and their children) for political advantage. He might also be aware that many of the goodly senators and representatives don’t realize the truth either. One wonders how many Republicans are among this ignorant group.
Whatever happens (or doesn’t happen) with the debt-ceiling – on August 2nd or on any other date before 2017 – there is no chance of Social Security checks not going out on time, unless the president chooses to violate the law and stop them by executive order. It is difficult to visualize him doing that, but he has surprised legal beagles before – e.g., stiffing the GM and Chrysler bondholders – and he could do it again. The difference in this case would be the number of people affected by the president’s actions – i.e., millions of pensioners instead of a few thousand “rich old guys” holding bonds they thought were good as gold. With a Social Security stoppage, somebody is bound to notice that his actions are actually illegal. Surely a gaggle of lawsuits would spring up to challenge his actions.
Actually, no lawsuits of this kind could be entertained by the courts – unless they become scofflaws, too. Surprising numbers of citizens (who evidently snoozed through civics class) do not realize that a sitting president of the United States cannot be sued for actions performed as part of his official duties. Nor can any senator, representative, cabinet officer, member of the military, or civil servant. All these are expressly exempted by the Constitution from arrest or legal action.
There are ways to remove or discipline each of the parties listed above. But a sitting president cannot be disciplined. The only Constitutional remedy is impeachment by the House of Representative and conviction by two-thirds vote of the Senate. Conviction results in removal from office. Of 44 presidents, only two have been impeached (i.e., formally indicted by the House), and none has been convicted. Andrew Johnson’s conviction failed by a single vote. Bill Clinton was impeached on two articles, but the Senate failed to convict him on either.
A Republican-controlled Senate failed to convict Mr. Clinton on two serious charges involving jury-tampering and perjury in the Paula Jones trial. If these are not High Crimes – within the meaning of the Constitutional language – one wonders what would be. One article failed, 45-55; the other failed, 50-50. Ten Republicans voted against the first article, and five voted against the second. All Democrats voted against both articles. A president inclined to flout the law obviously need not fear removal from office (unless the charge were stealing coffee from the Senate coffee-supplies).
Those votes surely have not escaped Mr. Obama’s notice. The Senate is currently under the (narrow) control of his own party, so there is absolutely no possibility of his conviction on any articles of impeachment, however serious they might be. As things stand, We the People are powerless to stop illegality of any kind by the president. He can do whatever he wants, including illegal stoppage of Social Security payments to gain a political advantage. He has nothing to fear. We live in dangerous times.